Policy Analysis No. 542

Corruption in the Public Schools: The Market Is the Answer

Executive Summary

One of the most frequently voiced objections to school choice is that the free market lacks the”accountability” that governs public education. Public schools are constantly monitored by district administrators, state officials, federal officials, school board members, and throngs of other people tasked with making sure that the schools follow all the rules and regulations governing them. That level of bureaucratic oversight does not exist in the free market, and critics fear choice-based education will be plagued by corruption, poor-quality schools, and failure.

Recently, news surfaced that appeared to justify critics’ fears. Between the beginning of 2003and the middle of 2004, Florida’s Palm Beach Post broke a slew of stories identifying corruption in the state’s three school choice programs. The number of stories alone seemed to confirm that a choice-based system of education is hopelessly prone to corruption. But when Florida’s choice problems are compared with cases of fraud, waste, and abuse in public schools—schools supposedly inoculated against corruption by “public accountability”—choice problems suddenly don’t seem too bad.

So which system is more likely to produce schools that are scandal free, efficient, and effective at educating American children? The answer is school choice, precisely because it lacks the bureaucratic mechanisms of public accountability omnipresent in public schools.

In many districts bureaucracy is now so thick that the purveyors of corruption use it to hide the fraud they’ve perpetrated and to deflect blame if their misdeeds are discovered. However, for the principals, superintendents, and others purportedly in charge of schools, bureaucracy has made it nearly impossible to make failed systems work. Public accountability has not only failed to defend against corruption, it has also rendered many districts, especially those most in need of reform, impervious to change.

In contrast to our moribund public system, school choice isn’t encumbered by compliance-driven rules and regulations, which allows institutions to tailor their products to the needs of the children they teach and lets parents select the schools best suited to their child’s needs. And accountability is built right in: schools that offer parents what they want at a price they are willing to pay will attract students and thrive, while those that don’t will cease to exist.

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Neal McCluskey is an education policy analyst at the Cato Institute.